The Straits Times
Nov 6, 2011 Real income divideMoving into a new neighbourhood has highlighted class differences

By Chua Mui Hoong

I was at a Dempsey cafe with some friends when a stray comment got me thinking about Singapore, social class and lifestyle experiences.

What do you do on weekends, I was asked.

Nothing much, I replied. My favourite weekend morning activity is to have breakfast at a hawker centre and read the papers.

Oh yes, he nodded. Just to soak in the atmosphere?

I was puzzled by the comment. In the two seconds it took me to process why, the conversation had moved on.

And then I realised why. I have lived in everything from an attap house to a landed property to a condominium, but I always returned to Housing Board flats.

Hawker centres, coffee shops and the rhythm of HDB life represent my native habitat. It is places such as Dempsey I go to, to soak in the atmosphere. And even then, I avoid weekend evenings when the trendy turn out in droves, and go there on quiet weekdays.

I moved to a HDB estate in the west five months ago. Since then, I've realised two things. One, I remain at heart an HDB kid. Two, I had become used to certain comforts of a middle-class life. I had assumed they were just common habits of an increasingly affluent Singapore, but living here has sensitised me to just how subtle but real, the gap is between the working class and the middle class.

In the Bukit Timah condominium where I used to live, every other car was a BMW, an Audi or a Mercedes, with a few Lamborghinis and Porsches. This is the UMI - upper middle income - class.

Many are millionaires. According to a Boston Consulting Group report in June, Singapore has the highest concentration of millionaire households in the world, with 16 per cent of all households boasting at least $1 million in assets under management. That's 170,000 households out of 1.13 million.

In Bishan where I also used to live, the carparks even of HDB estates are full of Japanese sedans and big cars, with a sprinkling of European luxury cars. This is the solid middle class, the HDB burgher.

In my current estate, every other vehicle is a van, pick-up or lorry of some kind. I glance at the registered addresses on the vehicle, and I know most of those driving these vehicles home are not the bosses. My guess is they are the delivery drivers, the maintenance technicians. This is working- class Singapore.

For the average HDB working class family, life remains a struggle. I see it around me. HDB shops have bare cement floors and fewer wares. Children play unsupervised by adults. When I changed my curtains, I packed my old ones into a bag, affixed a label that said 'Fits Master Bedroom' and left it at the foot of my block. It was gone when I returned from breakfast.

My categorisation of Singapore groups are, of course, generalisations based on anecdotal experiences. But anecdote can be the basis of insight.

In middle-class Bishan, I enjoyed the convenience of HDB life with its coffee shops, but I also had easy access to the cafes, organic food stores and deluxe cafes I enjoyed.

Here in the west, the merchandise and shop mix is different. I went shopping for Dryel. That's the dry-cleaning kit that comes with a zipped-up bag and sheets of chemical cleaners you can use in your dryer, so you can dry-clean your silk dresses at home.

I used to have no problems finding it in my old neighbourhoods. In my new estate, I couldn't find it in a few supermarkets. I asked one sales staff and was greeted with a stare, a loud question and a shake of the head. If you think about it, it's not surprising. Not many HDB families have a clothes dryer, so why would they need Dryel?

I gave up, and returned to my old haunt, the Cold Storage at Guthrie House, a tiny supermarket with an amazing knack of stocking things every household - okay, every UMI household - can need. There was Dryel. And nice bread. And nice pate to go with said bread.

I came to see that there are not just two Singapore: the heartlanders and the rest.

Among the heartlanders, there is the middle class and the working class.

And, I am coming to realise, there is another sub-set of the UMI class. If the UMI is the top 20 per cent, the top 1 per cent would be the Ultra Rich. My totally subjective definition of this group is that they earn at least $2 million a year, live in Good Class Bungalow areas or penthouse condominium apartments, and fly First or Business Class on holiday.

These folks apologise for their homes being 'only 5,000 sq ft' - as one interviewee once told me. Their numbers will grow, if Singapore continues to do well, and attract Asia's rising super class.

So there you have at least four groups: the working class and the middle class among the heartlanders; and in the private property group, you have the UMI and the Ultra Rich.

So long as social boundaries are porous, and the average heartlander can move from the working to the middle to the UMI group, the Singapore Dream remains alive.

The new twist in the old debate on inequality, though, is the gap among the elite: between the top 20 per cent and the top 1 per cent.

New York Times columnist David Brooks wrote last week of this Blue Inequa- lity fuelled by zooming incomes of the top 1 per cent.

'Within each profession, the top performers are now paid much better than the merely good or average performers. If you live in these big cities, you see people similar to yourself who are earning much more while benefiting from low tax rates, wielding disproportionate political power, gaining in prestige and contributing seemingly little to the social good.'

I have a feeling the anger over high ministerial salaries is fuelled in part by Blue Inequality. Some critics of the high-ministerial pay policy come from the UMI class, and don't see why folks who went to school or used to work in the same office with them, should be propelled into the Ultra Rich group once they enter politics, thanks to multi-million-dollar salaries paid out of the public purse.

It's easy to target the Ultra Rich as Public Enemy No. 1, as the other social groups can band together against them.

But that battle is not really relevant to the lives of the working class. For this group, what matters most are a job that pays enough for a life without strife, and good schools for their children. For this group that forks out only for essentials, a set of made-to-measure curtains is a luxury.

"I have a feeling the anger over high ministerial salaries is fuelled in part by Blue Inequality. Some critics of the high-ministerial pay policy come from the UMI class, and don't see why folks who went to school or used to work in the same office with them, should be propelled into the Ultra Rich group once they enter politics, thanks to multi-million-dollar salaries paid out of the public purse.

It's easy to target the Ultra Rich as Public Enemy No. 1, as the other social groups can band together against them.

But that battle is not really relevant to the lives of the working class. For this group, what matters most are a job that pays enough for a life without strife, and good schools for their children. For this group that forks out only for essentials, a set of made-to-measure curtains is a luxury."

This reaffirms my observation, which also explain the voting patterns in the May GE as well as my sense of the type of comments being said about the government and Singapore by Singapore citizens...

just to add to discussion. Happiness is not a function of wealth but rather it is a function of relative wealth vs the group we hang out with. So we are happy when we either earn more to beat our peer group or if we switch to another peer group who earns less. This explains much of the article. It also explains the idea that middle upper do not agree with ministerial pay since it propels them into the elite group via taxpayers money which they pay alot of...

I would also refine what Ms Chuan has and say that there are 5 groups here in SG. The poverty class, working class, middle class, middle upper classes and the elite/upper . Divide them as follows :

05 % Poverty class : Total family earning below $1200 per month. No net worth or negative net worth. need govt subsidies/welfare to make ends meet.
25 % Working class : Total family earning below $3000 per month. Little net worth or negative net worth. Ineligble for govt help. But probably get help from relatives.
50 % Middle class : Total family earning below $10000 per month. Some networth but all tied up in HDB. Would venture to say networth below $500K.
20 % Middle Upper class : Total family earning below $30000 per month. Networth btwn 500K-10M, Avg 50% of assets tied up in home.
<0.1% Elite : Total family earning above 1M per annum. Networth 10M and up. Less than 30% of assets in home. There are about 10,000 such households in SG.

Most of the elite get their money via entrepreneurship. About 30+%. Another good pool of 20-30% get it via inheritance. The remainder are the usual surgeons, lawyers, CXOs, traders, finance types. Only in SG is there is added Ministers....

Which end of the spectrum?
Must be belonged to the near elite class....

Quote:<0.1% Elite : Total family earning above 1M per annum. Networth 10M and up. Less than 30% of assets in home. There are about 10,000 such households in SG.

10000 households? rather large number. Assuming that the average networth is 100million, the total networth is 1 trillion.http://en.wikipedia.org/wiki/National_wealth
According to wiki(may not be correct though), our household networth is around 1.16trillion.
So, the rest of the 99.9% share the 0.16 trillion?????

(08-11-2011, 01:03 PM)greypiggi Wrote: [ -> ]just to add to discussion. Happiness is not a function of wealth but rather it is a function of relative wealth vs the group we hang out with. So we are happy when we either earn more to beat our peer group or if we switch to another peer group who earns less. This explains much of the article. It also explains the idea that middle upper do not agree with ministerial pay since it propels them into the elite group via taxpayers money which they pay alot of...

I would also refine what Ms Chuan has and say that there are 5 groups here in SG. The poverty class, working class, middle class, middle upper classes and the elite/upper . Divide them as follows :

05 % Poverty class : Total family earning below $1200 per month. No net worth or negative net worth. need govt subsidies/welfare to make ends meet.
25 % Working class : Total family earning below $3000 per month. Little net worth or negative net worth. Ineligble for govt help. But probably get help from relatives.
50 % Middle class : Total family earning below $10000 per month. Some networth but all tied up in HDB. Would venture to say networth below $500K.
20 % Middle Upper class : Total family earning below $30000 per month. Networth btwn 500K-10M, Avg 50% of assets tied up in home.
<0.1% Elite : Total family earning above 1M per annum. Networth 10M and up. Less than 30% of assets in home. There are about 10,000 such households in SG.

Most of the elite get their money via entrepreneurship. About 30+%. Another good pool of 20-30% get it via inheritance. The remainder are the usual surgeons, lawyers, CXOs, traders, finance types. Only in SG is there is added Ministers....

Good points raised! I think I probably fall into the middle class - and trying hard to climb my way to the upper-middle, with only an HDB flat to my name (then again, it ultimately belongs to the Govt eh?). If I can get my networth past $500,000 perhaps then I can be considered upper-middle? Haha, just for the sake of it though, I don't think my lifestyle and "wants" will change very much.

Regarding your point about relative wealth, it's very true and I had read up on this before. Apparently, if you stay in a well-off area which has fine dining outlets and everyone owns a car, you'd feel compelled to spend the same amount to maintain the same social strata (even if it was for show). So people who live in swanky condos end up spending much more than if they hung around in mass-market ones, and so on. It's the emotional knock-on effect.

So the idea to build weath is to live not just below your means, but also in a neighbourhood which has a much lower social strata and spending ability than yourself. If you hang around people who don't own cars, take public transport, don't buy branded stuff and just own one HDB flat, then you won't feel pressurized to spend.

In short, human beings always like to show they are smarter and richer than their neighbours. The so called never ending one-upmanship game we like to play with each others. If you can escape playing this game, you will get rich faster. When you are in the Upper Middle Class, then you really can afford to start to play this game; if you really want to.

i am puzzled here. 500k asset onwards is considered as Middle Upper class. A BTO 4 or 5 room flats(you know build by who) can exceed this amount easily. Maybe 1.5M onwards in encumbrance free assets will be considered as 20 % Middle Upper class; relatively speaking with regard to our properties prices and high costs of living. Of course 30K/month earning should be in Middle Upper class income.